$BMY - Bristol-Myers earnings beat boosts stock

Shares were down in premarket trade Thursday, but rose 5.2% after the opening bell

Authored By Sarah Toy

Bristol-Myers Squibb Co. topped earnings expectations in the second quarter, giving the stock a welcome boost.

Shares were initially down 0.8% in premarket trade, but rose 5.2% after the market open.

Revenue for Bristol-Myers’ BMY, +5.18% latest quarter rose to $6.273 billion from $5.704 billion in the year-earlier quarter, driven by strong sales of its blockbuster cancer treatment Opdivo and blood-thinner Eliquis. Analysts polled by FactSet had been expecting revenue of $6.115 billion.

Sales of Eliquis rose 24% to $2.042 billion, beating the FactSet consensus of $1.971 billion, while sales of Opdivo rose 12% to $1.823 billion, meeting analysts’ expectations. Sales of rheumatoid arthritis drug Orencia also beat analysts’ estimates, coming in at $778 million. Analysts had expected sales of $755 million.

Sales of immuno-oncology drug Yervoy rose 17% to $367 million from $315 million a year ago, while sales of leukemia treatment Sprycel rose slightly to $544 million from $535 million.

Profit for the latest quarter rose to $1.432 billion, or 87 cents a share, from $373 million, or 23 cents a share, in the year-earlier quarter. Adjusted EPS was $1.18 a share, topping FactSet analysts’ expectation of $1.06 a share.

Bristol-Myers also increased its full-year adjusted EPS to between $4.20 and $4.30 a share from its previous guidance of between $4.10 and $4.20 a share, though the company lowered its full-year GAAP EPS forecast to between $3.73 and $3.83 a share from its previous guidance of between $3.84 and $3.94 a share.

The earnings beat comes after the company released mixed results Wednesday afternoon from a lung cancer trial looking at Opdivo both in combination with chemotherapy or with Yervoy, another Bristol-Myers immuno-oncology drug. The first part of the trial met its primary endpoint, showing that a combination of Opdivo and low-dose Yervoy showed better overall survival when compared with chemotherapy in patients who have non-small cell lung cancer (NSCLC) with PD-L1-expressing tumors. But the second part of that trial did not meet the primary endpoint of overall survival in patients with NSCLC — in that study, a combination of Opdivo and chemotherapy did not significantly improve overall survival compared with chemotherapy alone.

Bristol-Myers has had a difficult year. The stock has fallen 12% in the year to date amid investor concerns over the company’s pending acquisition of CelgeneCELG, +2.62% Celgene and Bristol both face significant challenges — Celgene will lose U.S. patent protection on its multiple myeloma treatment Revlimid in the next few years, and Bristol-Myers’ biggest earner Opdivo faces heavy competition from Merck & Co.’s MRK, +0.87% blockbuster cancer drug Keytruda.

In April, the FDA approved Keytruda as part of a combination therapy for kidney cancer, putting the drug in direct competition with Opdivo in the kidney cancer space, and based on Wednesday's results, it seems that Keytruda will continue dominating NSCLC market share.